Penny Stock Brokers – Not All Brokers Are Built The Same
Penny stock brokers also deal with blue chip companies and vice-versa. As such, once you have found the right stockbroker, it is often a simple matter of asking him to deal in penny shares, too.
Important Points to Remember
There are certain things that must be remembered when dealing with small cap shares. For one thing, you are dealing with possibly the riskiest investment ever, no thanks to the highly volatile nature of penny shares.
You can lessen your risks by trading under reliable platforms like the NASDAQ SmallCap Exchange. Needless to say, you must do your research about the market before, during and after every decision taken.
For another thing, you should choose your stockbroker well. Keep in mind that hidden charges can be tacked on the basic low-cost fees. You might just find yourself paying more for your penny stocks transactions than your Big Board stocks!
If you apply 100 percent caution in Big Board stocks with the economy as it is today, you should exert 200 percent more effort where small cap shares are concerned. You will appreciate it when you profit big-time where others lost money.
Plus, it is best to remember that penny stocks are meant to be traded on a regular basis instead of being treated as long-term investments. Do remember to keep your penny shares to just 10 percent of your total investment portfolio.
Preferred Brokers
Since each trader has a different buying and selling style, it goes without saying that choosing from among penny stock brokers is a personal decision. Just choose which among the following suits your trading style the best and you should be alright as a small cap share trader.
* ChoiceTrade – Winner of the prestigious Barron 4-star award, ChoiceTrade offers s flat fee of $5 on all trades. Thus, you can avail of benefits like unlimited number of shares traded, no transaction surcharges and fees, as well as no minimum each trade. Add in the excellent customer service and pricing options and you have one of the best penny share stockbrokers around.
* TD Ameritrade – This is one of the most popular discount online brokers and for good reasons, too. You can enjoy perks like a flat $9.99 fee on all orders regardless of size and price as well as no maintenance fees no matter the trading activity and account balance. However, you have to deposit $2,000 to open an account.
* Zecco Free Trading – One of the rare brokerage companies that offer free stock trades, Zecco is slowly but surely making a name for itself in the industry. You can avail of benefits like no minimum funding balance, low cost fees at $4.50 per trade, and a forex trading platform.
* Scottrade – Yet another popular discount broker, Zecco charges $7 on all orders although an additional fee is imposed on stocks valued at under a dollar. If you are trading in relatively small amounts, it is the best choice.
There are many more penny stock brokers in the market today. Just to mention a few more, you have Lowtrades. ShareBuilder and SogoTrades. The dictum still remains, however, regardless of the number of brokers present – choose according to your trading needs.